What the Warranty Says About Item Relocation
Previously, we looked at what the warranty contract says about whose responsibility it is to relocate personal items when it is necessary in order to complete warrantable repairs.
Section III.A. of the warranty was cited, which states:
“If an improvement, fixture or property not constructed by the Builder/Seller is damaged or requires removal during the repair, it is Your sole responsibility, and not the responsibility of the Builder/Seller or Warranty Insurer, to pay for the cost of repair or removal of such improvement, fixture or property…”
Personal Property Damage
Today we will address the other issue included in that section, which states the homeowner is responsible to pay the cost of repair should personal or other property not constructed by the Builder/Seller be damaged. Why doesn’t the Warranty cover damage to personal property?
The underlying concept for damage to personal property not being the builder/seller’s warranty obligation is absolutely fundamental to the products offered by 2-10 Home Buyers Warranty (2-10 HBW), and the concept is that 2-10 HBW offers a warranty program, NOT an insurance program. The primary difference between a warranty and insurance is a warranty covers “products” against “defects,” and insurance covers “damages” caused by “accidents” or other causes. As it states in Section I of the Warranty Contract:
“Your warranty is not a policy of insurance, a maintenance agreement or a service contract…As described in this booklet, coverage is limited to qualified defects…”
Defects Versus Damage
Coverage being limited to qualified defects is crucial because qualification is determined according to the stipulations contained in the warranty, two of which expressly exclude damage to any property not included in the purchase price of the home, as well as loss or damage to material or work supplied by anyone other than the builder/seller. The 2-10 HBW warranty covers designated components of the home against “defects,” which within the framework of the warranty includes “structural failure”, or failure of a component to meet the “Construction Performance Guidelines.”
When a Builder/Seller enrolls a home with a 2-10 HBW warranty, they are asserting the home complies with the terms of the warranty contract. And to the extent the home does not, the warranty may provide surety according to the provisions contained in the contract. The builder still might be liable for damage to personal property they cause, but typically the builder/seller’s General Liability Insurance covers that.